The Timken Co., a manufacturer of truck bearings and other steel components, saw its sales and profits drop in the second quarter of 2001 due to continuing weakness in global automotive and industrial markets and the U.S. manufacturing recession.
“U.S. factories are operating at their lowest capacity levels since the recession period of 1982-83. This reflects the steep drop in demand in most markets,” said W.R. Timken Jr., the company’s chairman & CEO. “While some economists see growth rebounding in the fourth quarter, a large question remains for the manufacturing sector. It has been hit much harder than the rest of the economy and could take longer to recover.”
Timken’s second-quarter net sales were $634.4 million, down 8.5% from $693.3 million in the second quarter of 2000. The company had restructuring and reorganization charges in the second quarters of both 2001 and 2000.
Excluding those pretax charges, second quarter net income in 2001 was $1.6 million compared with $24.7 million a year ago. Pretax restructuring and reorganization charges of $17.3 million were taken in the second quarter of 2001.
For the first six months, sales fell 7.1% to $1.3 billion from $1.4 billion in the first half of 2000. Excluding pretax restructuring and reorganization charges, net income for the first half of 2001 was $11.4 million versus $50.8 million a year ago.